Andrew J. G. Cairns

Interest Rate Models:
An Introduction

Paper | March 2004 | ISBN: 0-691-11894-9
Cloth | March 2004 | ISBN: 0-691-11893-0
288 pp. | 6 x 9 | 52 lline illus.

The field of financial mathematics has developed tremendously over the past thirty years, and the underlying models that have taken shape in interest rate markets and bond markets, being much richer in structure than equity-derivative models, are particularly fascinating and complex. This book introduces the tools required for the arbitrage-free modelling of the dynamics of these markets. Andrew Cairns addresses not only seminal works but also modern developments. Refreshingly broad in scope, covering numerical methods, credit risk, and descriptive models, and with an approachable sequence of opening chapters, Interest Rate Models will make readers--be they graduate students, academics, or practitioners--confident enough to develop their own interest rate models or to price nonstandard derivatives using existing models.

The mathematical chapters begin with the simple binomial model that introduces many core ideas. But the main chapters work their way systematically through all of the main developments in continuous-time interest rate modelling. The book describes fully the broad range of approaches to interest rate modelling: short-rate models, no-arbitrage models, the Heath-Jarrow-Morton framework, multifactor models, forward measures, positive-interest models, and market models. Later chapters cover some related topics, including numerical methods, credit risk, and model calibration. Significantly, the book develops the martingale approach to bond pricing in detail, concentrating on risk-neutral pricing, before later exploring recent advances in interest rate modelling where different pricing measures are important.

Andrew J. G. Cairns is Professor of Financial Mathematics at Heriot-Watt University in the United Kingdom. After completing his Ph.D. in statistics he worked as an actuary with a major life insurer, and since rejoining academia he has specialized in interest rate modelling and financial risk management for pension plans.

Endorsements:

"This book provides an excellent introduction to the field of interest-rate modeling for readers at the graduate level with a background in mathematics. It covers all key models and topics in the field and provides first glances at practical issues (calibration) and important related fields (credit risk). The mathematics is structured very well."--Rudiger Kiesel, University of Ulm, coauthor of Risk-Neutral Valuation

"A very useful book that provides clear and comprehensive discussions of the topic that are not easily available elsewhere."--Edwin J. Elton, New York University, author of Modern Portfolio Theory and Investment Analysis

Feng-hsiung Hsu

Behind Deep Blue:
Building the Computer that Defeated the World Chess Champion

Paper | March 2004 | ISBN: 0-691-11818-3
320 pp. | 6 x 9 | 30 line illus. 10 halftones.

On May 11, 1997, as millions worldwide watched a stunning victory unfold on television, a machine shocked the chess world by defeating the defending world champion, Garry Kasparov. Written by the man who started the adventure, Behind Deep Blue reveals the inside story of what happened behind the scenes at the two historic Deep Blue vs. Kasparov matches. This is also the story behind the quest to create the mother of all chess machines. The book unveils how a modest student project eventually produced a multimillion dollar supercomputer, from the development of the scientific ideas through technical setbacks, rivalry in the race to develop the ultimate chess machine, and wild controversies to the final triumph over the world's greatest human player.

In nontechnical, conversational prose, Feng-hsiung Hsu, the system architect of Deep Blue, tells us how he and a small team of fellow researchers forged ahead at IBM with a project they'd begun as students at Carnegie Mellon in the mid-1980s: the search for one of the oldest holy grails in artificial intelligence--a machine that could beat any human chess player in a bona fide match. Back in 1949 science had conceived the foundations of modern chess computers but not until almost fifty years later--until Deep Blue--would the quest be realized.

Hsu refutes Kasparov's controversial claim that only human intervention could have allowed Deep Blue to make its decisive, "uncomputerlike" moves. In riveting detail he describes the heightening tension in this war of brains and nerves, the "smoldering fire" in Kasparov's eyes. Behind Deep Blue is not just another tale of man versus machine. This fascinating book tells us how man as genius was given an ultimate, unforgettable run for his mind, no, not by the genius of a computer, but of man as toolmaker.

Feng-hsiung Hsu is the founding father of the Deep Blue project. He began it in 1985 as a graduate student at Carnegie Mellon University. From 1989 to 1997 he worked as the system architect and chip designer for the Deep Blue Chess machine at IBM's T. J. Watson Research Center. He is now a senior researcher at Microsoft Research Asia.

Reviews:

"Mr. Hsu manages to make seemingly dry, technical material vivid and gripping, even for readers without a background in chess or computers. And his story is a fascinating study, of men as well as machines."--Christopher F. Chabris, The Wall Street Journal

"Hsu's account is written in an easy, flowing style, and, as he says, it is rather light-hearted. . . . The point that Hsu makes is that building and programming a computer that can calculate 2 million chess moves a second is not frivolous . . . All science is a kind of play, in the sense of a play of mind. . . . Most of Behind Deep Blue is Hsu's tale of encountering and overcoming obstacles in the design and programming of the computer to enable it to play chess like a human being. The technical aspects of both computers and chess will be fully comprehensible only to those with the appropriate experience and skill. The human story, though, is clear and exciting: dversity encountered, challenges met, all with the human elements of pride and anxiety and triumph. And the human elements, too, of anger and resentment."--Anthony Day, Los Angeles Times

"This book tells the gripping story of the construction, programming, preparation and use of the Deep Blue chess machine and its predecessors. It proves on every page the authoršs claim that computer scientists are human too, and they do like to have fun. The fun will be shared by the reader who has no prior knowledge of chess or of computer science."--Tony Hoare, Times Higher Education Supplement

"A chess-playing machine rather than a mere program, Deep Blue drew its awesome power from chips designed by Hsu to do nothing but play chess. The IBM team put 256 of these processors into a supercomputer, allowing it to analyze at least 100 million chess positions a second."--Nell Boyce, U.S. News and World Report

"A fascinating account of the IBM computer and the match, written by its programmer."--Lubomir Kavalek, The Washington Post

More reviews

Table of Contents:

Preface i
Acknowledgements v
Chess Notation viii
CHAPTER 1: Prologue: Show Time! 1
CHAPTER 2: Carnegie Mellon: An Office of Troublemakers 6
CHAPTER 3: Taking the Plunge 17
CHAPTER 4: The Chess Machine That Wasn't 43
CHAPTER 5: The Race for First Machine Grandmaster 66
CHAPTER 6: "Knock, Knock. Who's There?" 87
CHAPTER 7: Intermezzo: First Date with History 102
CHAPTER 8: IBM: We Need a New Name 120
CHAPTER 9: Bringing up the Baby 138
CHAPTER 10: A Living Mount Everest 157
CHAPTER 11: Retooling 181
CHAPTER 12: The Holy Grail 199
CHAPTER 13: Epilogue: Life After Chess 256
APPENDIX A: A Lad from Taiwan 270
APPENDIX B: Selected Game Scores 285
APPENDIX C: Further Reading 290
Index 293

Subject Areas:

Mathematics
History of Science and Medicine, Philosophy of Science
Physics

Theodore M. Porter

Karl Pearson:
The Scientific Life in a Statistical Age

Cloth | March 2004 | ISBN: 0-691-11445-5
352 pp. | 6 x 9 | 18 halftones.

Karl Pearson, founder of modern statistics, came to this field by way of passionate early studies of philosophy and cultural history as well as ether physics and graphical geometry. His faith in science grew out of a deeply moral quest, reflected also in his socialism and his efforts to find a new basis for relations between men and women. This biography recounts Pearson's extraordinary intellectual adventure and sheds new light on the inner life of science.

Theodore Porter's intensely personal portrait of Pearson extends from religious crisis and sexual tensions to metaphysical and even mathematical anxieties. Pearson sought to reconcile reason with enthusiasm and to achieve the impersonal perspective of science without sacrificing complex individuality. Even as he longed to experience nature directly and intimately, he identified science with renunciation and positivistic detachment. Porter finds a turning point in Pearson's career, where his humanistic interests gave way to statistical ones, in his Grammar of Science (1892), in which he attempted to establish scientific method as the moral educational basis for a refashioned culture.

In this original and engaging book, a leading historian of modern science investigates the interior experience of one man's scientific life while placing it in a rich tapestry of social, political, and intellectual movements.

Theodore Porter is Professor of History at UCLA and author of The Rise of Statistical Thinking and Trust in Numbers (both Princeton)

Endorsements:

"Karl Pearson was one of the most significant architects of modern statistics. In this remarkable book, Theodore Porter superbly captures the romance (and seldom has the use of this word been so appropriate) of Karl Pearson's early flirtation with philosophy and the tortured path that led him to statistics."--Stephen Stigler, University of Chicago

"Brilliant! Karl Pearson is fortunate to have a biographer who saves him from what he most abhorred: his fear that a life could be reduced to a mere discovery, stripped of all its personal and historical specificity. "--Ken Alder, Northwestern University, author of The Measure of All Things

Borwein, Jonathan

Pi: A Source Book

3rd ed., 2004, Approx. 800 p. 90 illus., Hardcover
ISBN: 0-387-20571-3

Due: May 2004

About this book

This book documents the history of pi from the dawn of mathematical time to the present. One of the beauties of the literature on pi is that it allows for the inclusion of very modern, yet accessible, mathematics. The articles on pi collected herein include selections from the mathematical and computational literature over four millennia, a variety of historical studies on the cultural significance of the number, and an assortment of anecdotal, fanciful, and simply amusing pieces. For this new edition, the authors have updated the original material while adding new material of historical and cultural interest. There is a substantial exposition of the recent history of the computation of digits of pi, a discussion of the normality of the distribution of the digits, new translations of works by Viete and Huygen, as well as Kaplansky's never-before-published "Song of Pi." From the reviews of earlier editions: "Few mathematics books serve a wider potential readership than does a source book and this particular one is admirably designed to cater for a broad spectrum of tastes: professional mathematicians with research interest in related subjects, historians of mathematics, teachers at all levels searching out material for individual talks and student projects, and amateurs who will find much to amuse and inform them in this leafy tome. The authors are to be congratulated on their good taste in preparing such a rich and varied banquet with which to celebrate pi."- Roger Webster for the Bulletin of the LMS "The judicious representative selection makes this a useful addition to one's library as a reference book, an enjoyable survey of developments and a source of elegant and deep mathematics of different eras."- Ed Barbeau for MathSciNet "Full of useful formulas and ideas, it is a vast source of inspiration to any mathematician, A level and upwards-a necessity in any maths library."- New Scientist

Written for:

Mathematicians, historians of mathematics, computer scientists, mathematics teachers, amateurs

Table of contents

Preface.- Acknowledgements.- Introduction.- The Rhind Mathematical Papyrus-Problem 50.- Engles. Quadrature of the Circle in Ancient Egypt.- Archimedes. Measurement of a Circle.- Phillips. Archimedes the Numerical Analyst.- Lam & Ang. Circle Measurements in Ancient China.- The Banu Musa: The Measurement of Plane and Solid Figures.- Madhava's. The Power Series for Arctan and Pi.- Hope-Jones. Ludolph van Ceulen.- Viete. Variorum de Revus Mathematicis Reponsorum Liber VII.- Wallis. Computation of Pi by Successive Interpolations.- Wallis. Arithmetica Infinitorum.- Huygens. De Circuli Magnitudine Inventa.- Gregory. Correspondence with John Collins.- Jones. The First Use of Pi for the Circle Ratio.- Newton. Of The Method of Fluxions and Infinite Series.- Euler. Chapter 10 of Introduction to Analysis of the Infinite.- Lambert. Memoire Sur Quelques Proprietes Remarquables Des Quantites Transcendentes Circulaires et Logarithmiques.- Lambert. Irrationality of Pi.- Shanks. Contributions to Mathematics Comprising Chiefly of the Rectification of the Circle to 607 Places of Decimals.- Hermite. Sur La Fonction Exponentielle.- And much more...